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Within major developed markets such as the U.S. or continental Europe, dispersion remains low. Across different geographies and asset classes, however, dispersion has increased; the opportunity set and relative risk of different currency areas has evolved.
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Emerging markets have become considerably decoupled. With Brazil’s market collapsing in advance of a hard-to-call election, Russian markets roiled by sanctions (yet attracting value investors internationally), China nervous and India quite the opposite – equity dispersion has risen far above developed market levels and into the top quartile of its historical range. |
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Correlations were more or less unchanged in the S&P 500® (and in our other U.S. indices), fell in the S&P Europe 350 (as the U.K had a very distinct story this month) and have fallen close to all-time lows across the S&P Ex-US Developed LargeMidCap BMI. |
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